About this Show

Your Money

News/Business. CNN anchors break down the financial news of the week. New.

NETWORK
CNN

DURATION
01:00:00

RATING

SCANNED IN
San Francisco, CA, USA

SOURCE
Comcast Cable

TUNER
Virtual Ch. 759 (CNN HD)

VIDEO CODEC
mpeg2video

AUDIO CODEC
ac3

PIXEL WIDTH
1920

PIXEL HEIGHT
1080

TOPIC FREQUENCY

Us 10, Ali 10, America 10, U.s. 8, Christine 6, Romney 5, Steven 5, Nunn 5, Washington 5, Miami 4, Sam Nunn 4, John King 3, Simpson Bowles 3, Florida 3, Spiriva 2, Don 2, Solis 2, Obama 2, Georgia 2, Bank On Gasoline 1,
Borrow a DVD
of this show
  CNN    Your Money    News/Business. CNN anchors break down  
   the financial news of the week. New.  

    October 7, 2012
    12:00 - 12:59pm PDT  

12:00pm
a new report out friday points to a steadier labor market, but some conservative conspiracy theerists are trying to spin it for political gain. i'm ali velshi and this is "your money." let's get to the facts. christine has our numbers for us. christi christine? >> we have unemployment number that dropped down to 7.8%. that's down 1.8% from last month. that's one survey.
12:01pm
another business survey shows net jobs created, 114,000 net jobs created. it's below the average for yeert, but just a few thousand more than economists had been expecting. let's show you the long term, ali. 40% of people out of work in this country have been out of work for six months or longer. there's the unemployment number. 14.7% of the labor market are either underemployed or they're working part-time, they would like to be working full-time, they're not really being used to their full potential. those are the headline numbers, ali, from that jobs report. >> christine, stay with us. the jobs report numbers were quickly, quickly positiliticize more politicized than normal. it's been a while and i didn't think we would be talking for this reason, but some conservative voices challenged the legitimacy of the labor department numbers when they came up on friday. they said, how is it possible that we created 114,000 jobs,
12:02pm
not enough generally to keep pace with population growth, and yet the unemployment number went down, the percentage? and they said -- they suggested, they hinted, that there might have been political interference in the labor department's calculations. i find this quite stunning. >> it is, and it's ludicrous. i think it's totally inaccurate. i have the highest regard and faith in our bureau of labor statistic individuals. these are civil servants. they are not political. they have served many years in their capacities as professional statisticians, analysts. they serve under establishments. they're not political at all. i receive the first listing every friday of the month at 8:00 a.m., and i am reporting on exactly what's given to me. there is no manipulation that occurs, and i am just astounded that people are making these accusations. it's unfortunate because the fact of the matter is that we've
12:03pm
seen job growth. we've seen a lot of people who now are finding employment, and you have basically two surveys. one that reports the receipts of jobs being created, payroll, and then you have the household survey. the household survey also includes people that are self-employed and also that are attached to new jobs that are coming about. these are the smaller jobs, smaller businesses that are creating jobs. both of them are married and we come up with the infoation that's presented to me. all i can say is that in the past two and a half years, we've seen now a 5.2 million private sector jobs created. can we do better. absolutely whave to do better. >> i agree with you, that's an entirely separate discussion as to whether you think we can do better. the issue of attacking the bureaucracy is new even in america. let me ask you this. there has been no substantial change in the way these numbers have been calculated in recent history, am i right? >> exactly. and this methodology has been in
12:04pm
place for decades. >> secretary solis, i'm glad you could join us and clear this up. thank you for joining us. >> you, too. thank you. >> secretary solis told us something you know, that these were calculated as two separate surveys. what she was explaining was the job creation numbers, that bar graph you always use, is a report of companies and their payrolls. the unemployment number, the percentage, which has gone down today, this week, is a percentage of -- that's a number based on a household survey, phoning people at home. >> i'm going to make two points here. if you really believe as one group said in a press release that there are bankroll bobs making numbers for the regime, if you believe that like some conspiracy theorists apparently do, why weren't these numbers available before?
12:05pm
and why weren't these taking the wind out of the dnc because the headlines the next day was about a jobs number that wasn't very good. it doesn't make sense, it defies logic, we know these people, we crunch the numbers as people have seen. it really hurts the movement of small government, i think. because i think a lot of people realize our government is very big. it has become much bigger, and well-thinking moderates in both parties can say we need a smaller footprint of the government. but when the small government movement comes out and just says crazy things like this, it hurts their cause. >> i absolutely agree with you, christine. thanks for clearing that up. stay there. we'll be back to you a little later. steven moore san editorial writer for the wall street journal. steven, i want to talk about the real stuff here, the real meat of this jobs report. before we do that, i think christine's point is very valid, and that is that there is a
12:06pm
really reasonable and strong argument for smaller, more effective government in the united states, but these kind of conspiracy theories do nothing to help anybody's cause. >> i don't think there was a conspiracy behind these numbers at all. it's misty fiing, we're a little confused, ali, why there was such a big leap in one of the jobs surveys and a modest gain in the other. a lot of economists like myself are scratching our heads trying to peer at these numbers a little closer and figure it out, but i do not believe there was a conspiracy. >> but if you don't believe there was a conspiracy, take your best shot. it's not a number that barack obama can really crow about. i have been saying for a very long time for most people, kind of ignore the unemployment rate because it does kind of move around in an unpredictable way. the lost jobs and lost jobs number is really the only one you can get your teeth into. the unemployment number not one mitt romney can sink his teeth into, either.
12:07pm
>> we did see a big gain in this household survey. here's one of the problems with the number that came out. the big gain in jobs, ali, about 600,000 of those jobs were an increase in part-time work. now, look, working part-time is better than not having a job at all, no question about it, but try feeding your family, try paying your medical bills, try paying for all of your other expenses like your mortgage with a 20 to 25-hour job. look, i think the american people still believe, as i do, it's still a pretty miserable labor market out there. it's getting a little better, ali, but not a whole lot. >> diane swann is the chief employment director out of chicago. let's deal with other rates other than those that gets confusing. 40% have been unemployed for six months or more. as steven just alluded to, many
12:08pm
of the jobs created are not of the quality you would like to see. what's your evaluation of where we are in our efforts to get our jobs back? >> well, i think the point that steven made about the 600,000 is really important because it's two-thirds of those jobs where people were looking for full-time to extend on steven's point and only got part-time. some of that is seasonal hires. we see retailers are hiring sooner, around halloween. so they get jobs, but it's not really what they want, the quality they want. when we get to the payroll survey, you really see that great divide that's emerging. maybe not about the labor market, but more so because they've seen home values come up. that's our largest wealth factor that's no longer falling. i think that's a big factor in the confidence figures. also we're seeing refinancing pick up, 80% of mortgages, applications today are refinance applications. a lot of that money is coming
12:09pm
back into the economy and will help in the fourth quarter. all the job losses on the manufacturing side two months in a row in the heavy manufacturing sector, that's global demand, so you really see the unevenness of the recovery persist, and that's not enough. >> and the presidential candidates can have difficulty moving the needle on that, but you did talk about housing which i call the golden lining around the cloud. i want to bring in ron peebles. he's a top fundraiser for the obama campaign. don, you're not buying individual homes, but there's definitely stuff going on in the construction sector, in homebuilding, in home buying, as diane said, in refinancing. these low rates as expensive as they've been to keep in place, it seems to be combining with low income prices. >> if you look at the market in miami, for example, which was
12:10pm
one of the biggest drops when the housing recession hit the hardest, miami is back. miami is back in a very big way. new york is back in a very big way. washington, d.c. is back. markets like phoenix, they're back as well. nevada, for example, still having a lot of difficulty. that's a combination of foreign interest, foreigners buying in our markets. especially we see south florida where south americans are looking at our u.s. markets as being very, very cheap. so you look at a big chunk of those buyers in florida, for example, on foreign buyers. so many americans are taking advantage of these lower interest rates. also rental rates have gone up so much that the cost of ownership right now in many instances after taxes is less money than it costs to rent. the big challenge, though, is we're not getting enough people able to move up out of their existing houses. we're not getting enough people to relocate because they're stuck in their homes even though they're current on their mortgages, even though they
12:11pm
qualify for their mortgages, the homes are worth so much less than their current mortgage amounts. they can't get out and they can't refinance. and so there's got to be a new policy that comes in to address that challenge. >> ali, could i mention something about housing for a second? i want to pat myself on the back for a minute here, because as you know, for the last year or two, i've been somewhat bullish on real estate and housing, and i think we are seeing, this gentleman is right, if you look at the major markets, you are seeing a rebound in real estate, especially in states like florida and states like arizona, and what's interesting is the two reasons, i think, you're seeing an uptick is number one, you've got these mortgage rates that we're going to be telling your grandchildren there was a time you could get a mortgage for less than 4%. but another thing to think about. if you're worried about inflation ticking up in the future, and i am given all the money, what's a good way to protect yourself against inflation? own real estate, because it hold its value.
12:12pm
>> i want all three of you to stay right where you are. we're going to talk more about jobs and we're going to keep looking at how housing is not the silver lining but probably the gold lining in the economic storm clouds that are threatening the recovery. there are a lot of warning lights and sounds vying for your attention. so we invented a warning you can feel. introducing the all-new cadillac xts. available with a patented safety alert seat. when there's danger you might not see, you're warned by a pulse in the seat. it's technology you won't find in a mercedes e-class. the all-new cadillac xts has arrived, and it's bringing the future forward.
12:13pm
chances are, you're not made of money, so don't overpay for motorcycle insurance. geico, see how much you could save.
12:14pm
like in a special ops mission? you'd spot movement, gather intelligence with minimal collateral damage. but rather than neutralizing enemies in their sleep, you'd be targeting stocks to trade. well, that's what trade architect's heat maps do. they make you a trading assassin. trade architect. td ameritrade's empowering web-based trading platform. trade commission-free for 60 days, and we'll throw in up to $600 when you open an account. diane, what were you saying just before the break about
12:15pm
housing not always being as safe as we think it is? >> actually, there's two critical issues. housing is number one and it's still on such low levels and we're seeing housing recovery occur in places like apartment rentals more than single family. after adjusting for adjustment levels, we're in trouble. we are seeing investors come in because of all the right things. steven and i agree it's actually a good time to buy real estate. that said, there are investors coming in to buy real estate, buying single family properties either renovating out of foreclosure or building it and then renting it. when you flip to buy, you have far less multipliers. let's face it, renters are harder on property rather than owners, so the multiplier is less. but we're also not seeing the real comeback on single family housing starts that we'd like to see to see the jobs you really
12:16pm
want to see. that's one of the reasons the fed picked mortgage-backed securities to purchase and try to help that market, and i think that's important to remember right now. >> let's take this over to don for a second. don, you're the guy who can explain in very clear terms for my audience how it is that the combination of low interest rates and low property rates and a boom in housing, how much of a relationship that has to job creation. i think there may be still some people in this country that don't get what a big deal that is. tell me how you end up creating jobs. >> number one, of course, is cotruction jobs. when there is a demand for new housing and when inventories decline, as they have been doing over the past 36 months gradually going down, and now they're significantly going down, for instance, miami is what it was during the boom town. that creates a demand for new inventory and new product, new construction. not just on housing, by the way, on multi-family housing. cond
12:17pm
condos, hotels all generate construction jobs. then massive amounts of supplies and building materials that are necessary and the consultants, the architects, the engineers, the professionals, even the lawyers. they all get hired to help create this product of real estate, housing and so forth. i also disagree, by the way, that real estate is not the best hedge against inflation. it is, and if you look at 2006, i can assure you that by 2016, those property values will have come back and that asset, that real estate asset, even in las vegas, will have outperformed inflation during that same tenure window of time. real estate is a long -- it's not a commodity, it's not a stock, it's an asset that you have a u titilitarian asset out, and over time it helps.
12:18pm
my father paid about 16,000 for it, sold it for about $500,000 and it was his nest egg for retirement. >> the problem is most people don't hold their homes that long. i've been in a house for 21 years and i agree with that in terms of principle, having a home for a long time, but that's just not the way the american housing market has worked over the last 20 years, and i think that's important to point out as well. >> actually, it has worked. up until the big boom, the average rate of single family homes was over ten years. if americans look at housing as not a speculative asset but an asset they can utilize and invest in their long-term future, they will outperform any other investment. >> i think we're all greeg agren this point, actually. i want to ask steven something else here. there are four of us, actually, i forgot my math. all four of us agree on this point. why is it that mitt romney says he can't create 12 million jobs
12:19pm
over four years? he speaks almost exclusively about lowering taxes to spur job growth. i have a suspicion you actually agree with him on that. >> i know you've been step catyl about that number. i think it's very achievable. even though we have had 5 million new jobs over the past four years, do you realize we're still about 4 million jobs short of where we were in 2007? so we still have a lot of ground to be made up, in fact, we should be growing the labor force and employment by about double the rate that we are. if we pick up the pace we should be at and keep that for four years, i do really believe 12 million jobs is achievable. my goodness, ali, we did that in the 1980s under a republican president, under reagan, and under a democratic president, bill clinton. >> and it was 4.5% in one case, 4.3%, and i can't find an economist that can tell me we'll have that kind of growth rate. >> we should aspire to 12 million jobs even if we can't do
12:20pm
it. >> and i should aspire to look like brad pitt. that's not going to happen, either, but thank you all for coming on the show today. coming up, something both candidates actually agree on. >> if somebody had an advanced degree, i want them to stay here so i stamp a green card on their diploma. >> as soon as they get their degree, we send them home to create more products and more growth somewhere else. that doesn't make sense. >> entrepreneurs can be a powerful force for job creation, but u.s. policy is standing in the way. [ male announcer ] does your prescription medication give you the burden of constipation?
12:21pm
turn to senokot-s tablets. senokot-s has a natural vegetable laxative ingredient plus the comfort of a stool softener for gentle, overnight relief of occasional constition. go to senokot-s.com for savings. just a second. just, just one second. ♪ get outta the car. ♪ are you ok? the... get in the car. [ male announcer ] the epa estimated 42 mpg highway chevy cruze eco. for wherever life takes you. and now qualified buyers can get 0% apr financing for 48 months on a 2012 cruze. ♪
12:22pm
12:23pm
...and we inspected his brakes for free. -free is good. -free is very good. [ male announcer ] now get 50% off brake pads and shoes at meineke. friday's jobs numbers underscore something we already knew. we need more jobs in this country, so how do you create them? one answer may surprise you: immigration. i know what you might be thinking. how does bringing more people in this country already without enough work create jobs? doesn't it take jobs away from hard-working americans who desperately need employment? the truth is that highly skilled immigrants with degrees in
12:24pm
science, technology, engineering and math, aka the stem jobs, they create jobs for other americans. according to one study, from 2000 to 2007, for every 100 foreign-born workers who earned an advanced stem degree here in the united states and went on to work in those fields, that created an additional 262 jobs for native-born americans. but instead of embracing this, the u.s. immigration policy sends those highly skilled immigrants, many of them, educated in the best american colleges and universities back home to their country of origin so they can create jobs there, competing with the u.s. in the global economy. it's called the reverse brain drain. joining me is the director of research at duke university. he's also the author of "the immigrant exodus, why america is losing the global race to capture entrepreneur talent." your research found that from 1995 to 2005, immigrants founded
12:25pm
more than a quarter of all tech and engineering start-ups in the united states and more than 52% of those in silicon valley. you have just updated the numbers, and immigrant entrepreneurship has declined. talk to me about this. why is it happening and how do we fix it? >> it's very simple. there are a million skilled immigrants here waiting for permanent residents visas. many of them want to start companies and employ americans and do good for this country. we won't let them, wevisas. so they're getting frustrated and going home. so now we're now boosting our competition. >> it's weird, it's bringing policy both presidential candidates disagree with. you heard mitt romney saying he wants to staple a green card to the degree. where is the holdup? where is the problem? >> i i call them juveniles battling each other rather than
12:26pm
try to fix the problem. everyone needs we need a start-up visa to start entrepreneur companies here, that we want more scientists, more engineers, more doctors, it's good for america, but they won't give each other political victory. both sides support stem, but they won't agree on legislation for petty wrangling they're doing. it's really silly what's going on in capitol hill. >> the same stuff we've been talking about the rest of the show, they can't agree on stuff that will likely send us into a recession, they can't agree on that. so this is probably way down on the political totem pole. by the way, it's probably easiest to get rich in asia, so does this support the possibility that there are opportunities in other countries for highly skilled workers. the u.s. is not the only game for them. >> absolutely. duke surveyed 700 entrepreneurs that went back. we were shocked to learn from them that they're doing better back home. how could they be doing better back in india and china with all the corruption and the pollution and so on?
12:27pm
but they said they're doing better financially than they were doing here, they're doing better in terms of quality of life. almost every metric they're doing better back home than they are over here. big surprise. this is a wake-up call for america. we can't assume this is the only land of opportunity. for great people there are opportunities in many, many other countries in the world. unless we do everything we can to get them here, they will become our competition. >> this hold on the permanent residency and the start-up visas and the green cards for a second, hh-1b says the number i capped at 600,000 visas per year for immigrants with advanced degrees. almost every year employment demand exceeds the number of visas issued with stem dominating the response. you can see that 64,000 of them were stem. look at these visa requests.
12:28pm
26,000 engineers, business operations, 20,000, health and treating, 18,000, and finance 13,000. you say we need more of these visas, but you also admit there is a dark side to this program. what is the dark side? >> well, the dark side is that right now if you're coming on an h-1b visa, you're tied to the employer, which means you can only work for the company that brought you in. if you file for a green card, the permanent resident visa could take a decade, 15 years to get the green card. in the meantime, while you're waiting you're stuck working for the same employer. knees employers know they have you captive, therefore, they're less likely to give you promotions, less likely to give you increases as other people, so you're stuck in a menial job. you have these really smart people coming here doing the same menial jobs they did when they entered the country for decades, the best part of their lives. this is really bad for america and for our competitiveness. >> do critics of this h-1b
12:29pm
program say that what you and i are saying is false? these are unskilled people coming into america taking jobs from america, and we're going to get tweets today, you are and so am i, i'm highly skilled in those areas and i can't get a job. we don't have a shortage. >> the results of brookings institute, they looked at the h-1b workers and they found that it's regional. there are shortages in silicon valley, there aren't shortages in other parts of america. but wherever there is more immigrants, wherever there is more demand, there is more economic growth. it sort of builds on itself. these people come in and work for american companies, they start their own companies and hire more americans. silicon valley is more than half immigrant. it's the most innovative place on this planet. >> always a pleasure to see you. we'll talk about this more once we don't have to talk about economic fiscal crisis and things like this.
12:30pm
>> read the book. >> i will definitely read the book. thank you. president obama and mitt romney talked about jobs at the debate. they talked about taxes, debt, even big bird, but neither candidate mention the the most immediate threat to our country. i'll tell you what that is next, on "your money." you've been busy for a dead man.
12:31pm
after you jumped ship in bangkok, i thought i'd lost you. surfing is my life now. but who's going to .... tell the world that priceline has even faster, easier ways to save you money. . . on hotels, flights & cars? you still have it. i'll always have it. so this is it? we'll see where the waves take me. sayonara, brah! take the steps to reach yours, everyowith usgoals. with real advice, for real goals. the us bank wealth management advisor can help you. every step of the way. from big steps, to little steps. since 1863 we've helped guide our clients, so they can take the steps to help grow,
12:32pm
preserve, and pass along their wealth. so their footsteps can help the next generation find their own path. all of us serving you. us bank on gasoline. i am probably going to the gas station about once a month. last time i was at a gas station was about...i would say... two months ago. i very rarely put gas in my chevy volt. i go to the gas station such a small amount that i forget how to put gas in my car. [ male announcer ] and it's not just these owners giving the volt high praise. volt received the j.d. power and associates appeal award two years in a row. ♪
12:33pm
i've been warning you about the coming economic storm. that as positive job numbers and higher consumer confidence are convincing many of you that my storm, or at least talking about it, makes me full of hot air. but there is a storm coming if congress doesn't act soon. i'm talking about the fiscal cliff. that's more than $600 billion of budget cuts and tax hikes for next year mandated to start taking effect as early as january 1st. now, what can happen, you ask? let's bring in christine romans. she's the host of "your bottom line" to answer that very question. christine? >> ail, i cannot confirm or deny that you're full of hot air, but i can tell you tax hikes will affect us all if nothing is done
12:34pm
to avert this fiscal cliff. here's what we're looking@t at the beginning of the year. taxpayers will pay $3,000 more in taxes if they don't do anything. a new report from the center of regional analysis at george mason university predicts that some 277,000 federal employees will lose their jobs in the next 12 months. that's 14% of the federal work force. and 14 of the 17 economists surveyed by cnn money, ali, they predict the fiscal cliff will cause a new recession. interestingly, all 17 believe the economy won't plunge off the cliff becau they think congress will finally get its act together and do something in the lame duck session following the elections or when the new congress convenes in late january. lame in either case. but by then it could be too late
12:35pm
for the economy, and that's because companies don't like uncertainty, ali, and some say they're already holding back on hiring. we can't have an economic recovery without job creation. >> with a looming economic disaster like the fiscal cliff, you would have expected the topic to top the presidential debate. i was waiting for the question. i wanted to know the leadership they were going to take. you have devised a word cloud from that first debate, and it turns out the words most uttered -- well, the words most uttered were the big ones. people, medicare, governor, obviously, romney. what jumps out? i don't know, but what doesn't jump out is the words fiscal cliff. neither president obama nor mitt romney mentioned it at all during wednesday's debate. i was kind of amazed, christine. i was amazed to have a debate focused on the economy and not one word about how these guys would avert the fiscal cliff, ask frankly, not one question from the moderator about the most serious thing that could be facing our economy right now.
12:36pm
christine, stay right where you are. i want to bring in cnn's chief national correspondent john king who has been a debate moderator in the past as well as the democratic u.s. senator from georgia sam nunn. he is actively working with both alan simpson and ershkin bowles to find simple, long-term solutions to the gridlock. think of this as simpson bowles 2.0. he's been highly critical over the handling of the fiscal cliff that threatens our economy. senator nunn, you have said, quote, both sides seem to have a political strategy, but their governing strategy is in doubt. those are your words. have you ever seen government so broken that lawmakers would rather take the economy to the brink? and i agree with those economists who say it probably won't happen, but why are we risking this? why are we risking these decision s on whether to employ someone because of something
12:37pm
that might happen? >> the lame duck session can change things, but what i would like to see instead of just kicking the can down the road and kicking the cliff down the road with this same draconian solution if we don't reach an agreement, change the can before you kick it and that means something like simpson bowles would become the default position. so you give congress time so take its own course if they choose to, but failing that, you would have a soft landing rather than a disaster, which is what we face now unless changes are made. so i do believe -- i do think we'll kick the can but i think it ought to be a different can with a soft landing. >> what an interesting point. we tried the if you don't do it it's going to be a catastrophe, and guess what, we couldn't trust them to avert catastrophe in good terms, so you're saying we need to do something else but it's not going to hurt the economy. let me bring in somebody you
12:38pm
know, senator john king. john, you watched, and you commented on the presidential debate. neither mitt romney nor president obama even mention the fiscal cliff. they talked a lot about the economy, they talked a lot about jobs. if i were a voter, i would be demanding an answer right now on exactly how anyone who wants any elective office in washington plans to prevent this insanity. >> it sort of came up once when jim lehrer reminded them and said, raise your hand if you'll take a deal for one dollar in tax increases you'll take $10 in spending cuts. neither one of them wanted to take that deal. neither wants to approach this because no one wants to say if i cut a real deal, i will cut the programs you love. governor romney knows the revenue question will be back on the table in some form. senator nunn has been gone from the town for a while and he's probably grateful for that. he used to serve in what they call the world's most
12:39pm
deliberative body. not so much anymore. coming up, winston churchill once said, you can always count on americans to do the right thing after they've tried everything else. i'll ask senator nunn why he's optimistic this federal congress can come together ask come up with something he just suggested, the condition being a soft landing, not a hard, dangerous landing that could send us into a recession. that's coming up next on "your money."
12:40pm
overmany discounts to thine customers! [old english accent] safe driver, multi-car, paid in full -- a most fulsome bounty indeed, lord jamie. thou cometh and we thy saveth! what are you doing? we doth offer so many discounts, we have some to spare. oh, you have any of those homeowners discounts? here we go. thank you. he took my shield, my lady. these are troubling times in the kingdom. more discounts than we knoweth what to do with. now that's progressive.
12:41pm
12:42pm
back on "your money." back with former georgia senator sam nunn. senator nunn, you made a very interesting suggestion a few moments ago. okay. if congress is bound to kick the can on a decision about cutting
12:43pm
spending and deficit control, change the can. come up with a condition for not making a deal that is actually palatable and not horrible for the economy like the current situation that we have. tell me how that would even happen? are there enough people like you and those who you are trying to work with who are actually still in office in washington to hammer out a more perfect compromise? >> i think those kind of people are in the house and the senate. i think they are talking with each other, but the problem is, ali, they're not getting support from their own leaders in the congress, republicans or democrats. they're not getting support from the white house. they're not getting support from the party base who insists on 100% solution in their favor, and the american people, the common-sense americans that i think are in the great majority have to rise up because that's the missing part of the airplane is the middle. the wings are flapping and making their voices heard but the middle is not, and that's got to happen because we have to get behind people like chambliss
12:44pm
from my state and mark warner from virginia and many others that are working together. >> john, you follow this in and out. you probably have a sense of congressional districts where there are people who might do this. how is that going to play? the wings are flapping and making noise and there is nothing coming from the middle. can we get something from the middle? >> i love senator nunn's analogy. there is dysfunction and there will be dysfunction until the election. then we have the lame duck session. the lame duck session and this question of what to do to keep the car from going over the cliff will be answered. if governor romney wins the election, then they will be willing to come to the table to talk about revenues. if the president wins the election, he'll say we're getting rid of tax cuts from wealthy americans. but even though the lame duck session will be the current congress, what they see in november will greatly influence.
12:45pm
so the best thing between now and the election is for you to talk about this on your program, hopefully the candidates will talk about it around the country and the american people in their votes on november 6 would make some kind of decision on this. but you mention touchdown didn't come up much in the debate, most candidates won't talk about it much because it requires tough choices. >> even the people who are going to have to fix this. you know, we talk about the senators, a few senators, who are starting to talk about start to go talk about a framework. and we don't have an awful lot of time. even when you talk to them and you say, look, can you tell me when are you doing this? we know there is a meeting next week. when are you going to hammer this out? they get very skittish. they don't want to raise expectations and they're still very, very far apart. so for all those people in washington who say, don't worry, 11th hour, they're going to get it done, that's not good enough. they haven't even started on this. >> christine, i'm getting tweets from people as we speak who are saying, you're chicken little, the world is falling, they're
12:46pm
going to make a deal, it's all going to be fine. why are you worried about this recession? you even said the economists said they'll get a deal, so why worry about this? >> the danger is a big receion. the worst thing they could do is go off the cliff. the second worst thing they could do is say we're going to punt for three months. now we have a framework and we're going to give ourselves a year to figure out how to get 4 trillion in spending cuts. guess what? you would have businesses saying we can't do anything until they get this mess fixed. >> let me ask sam nunn, i know you believe there are people working on this. do you think everybody working on this gets that there is a danger -- it may not be huge, but there is a danger that you can push this fledgling economy, this fledgling recovery, into a recession? >> let me give you the encouraging spin on the debate which goes to that point. both candidates, president obama and governor romney, said good things about simpson bowles. of course, neither one of them embraced it.
12:47pm
but the other thing that happened, and it hasn't been emphasized as much as i would have thought, i think we have some creeping candor going on in terms of the structural deficit situation. governor romney made it clear that he's going to have rate cuts but not tax cuts. he's talking about revenue neutral reduction in rates. that's a $5 trillion change just in one debate. and on the other side, president obama, this was a dog that didn't bark, in effect, because usually democrats talk about medicare and social security in a way that indicates they would never do anything about it. president obama, to his credit, did not do that. so i took some encouraging spin from those things during the debate. >> if you're encouraged, then we're encouraged. >> something that congress can build on. that may give people in the congress working together a little more ammunition. >> very good. thank you, senator. good to see you, as always, senator sam nunn. former senator from the state of
12:48pm
florida. john king and christine romans. can political leaders actually create jobs or are voters around the world being lied to with false expectations? q and a next with richard quest.
12:49pm
12:50pm
12:51pm
the fiscal cliff we are racing toward is the latest frightening example of the incompetent of our elected officials and what a small world we live in since people running for office around the world make unsubstantiated claims about job creation all the time. for all of things that matter in an economy, jobs matter the most. in a desperate world outlandish promises can give a candidate traction or even victory. joining me from london is richard quest, the host of
12:52pm
"quest means business" on cnn international and a man who would never make a promise that he couldn't keep. richard, today's q and a question, can political leaders actually create jobs, or are voters around the world, like those in america, being lied to and given false expectations? i'm going to go first. ring the bell and give me 60 seconds. presidents don't do as much to fuel jobs growth as president obama or mitt romney would like you believe. u.s. job growth may have more to do with slowdowns in europe and asia than anything washington does. they go instill confidence in consumers who feel safe ber spending money thereby creating demand and job. mitt romney after making a ridiculous pledge to create 12 million jobs in four years, a pledge that the obama camp quickly matched, now argues that the way he'll cut taxes without
12:53pm
increasing the deficit is so many jobs will be created under ms. administration that people work and spend the money they don't pay in taxes. it could happen. i could be as tall and handsome as you are, richard, but i don't promise to do so and i'm not asking anyone to vote for me. how much can politicians do to create jobs? they can create stability and an expectation of what will happen and low taxes and regulation. i don't know, richard. what do you think? >> i'm glad you asked. politicians do not, cannot, and will not create jobs. we agree on that. we also agree on the fact that they create an environment that allows the private sector, men and women who start businesses, to it you'lly create the jobs that we all seek. here's the important point. there is a no-difference theis time around, because what happened is the awful, deep,
12:54pm
structural recession. we are slowly but surely crawling our way out of a mess that took years it to get into, and he we certainly are not going to solve in the matter of a couple of months. that is why politicians who make promises are so disingenuous yus. that is why politicians who promise jobs are so dangerous. and that is why politics who promise jobs should be ignored. in the european union, we have unemployment over 11% and it is rising. that is the true disgrace of politicians and jobs. >> the difficulty, though, is when they both think the same, both sides make the same promises and you get stuck in the pickle you're in. >> but i heard you, ali velshi, maybe she can find the moment when you promise this, you promised that if one of those political promises were broken, i think you said you'd wear a
12:55pm
dress. >> if they make it, if they create 12 million jobs in four years i'll wear a dress. i'll be so happy it won't matter. we'll erase this tape. mopefully this doesn't get recorded. richard, always a pleasure to you. >> i'll pay good money. >> cut his mike off right now. >> i'll pay good money to see that. >> speaking about money, we have to raise some. when we come back, investor vs cashed out of $5.1 billion worth of u.s. stock mutual funds just last week. since the crisis hit, you've been scared. i don't blame you. i'll tell what you they're doing to protect your money coming up neshgs. bronchitis and emphysema. spiriva helps control my copd symptoms by keeping my airways open for 24 hours. plus, it reduces copd flare-ups. spiriva is the only once-daily
12:56pm
inhaled copd maintenance treatment that does both. spiriva handihaler tiotropium bromide inhalation powder does not replace fast-acting inhalers for sudden symptoms. tell your doctor if you have kidney problems, glaucoma, trouble urinating, or an enlarged prostate. these may worsen with spiriva. discuss all medicines you take, even eye drops. stop taking spiriva and seek immediate medical help if your breathing suddenly worsens, your throat or tongue swells, you get hives, vision changes or eye pain, or problems passing urine. other side effects include dry mouth and constipation. nothing can reverse copd. spiriva helps me breathe better. (blowing sound) ask your doctor about spiriva. is the same frequent heartburn treatment as prilosec otc. now with a fancy coating that gives you a burst of wildberry flavor. now why make a flavored heartburn pill? because this is america. and we don't just make things you want, we make things you didn't even know you wanted. like a spoon fork. spray cheese. and jeans made out of sweatpants.
12:57pm
so grab yourself some new prilosec otc wildberry. [ male announcer ] one pill each morning. 24 hours. zero heartburn. satisfaction guaranteed or your money back.
12:58pm
congress is on vacation and the white house is in election mode and economic storm clouds are gathering on the horizon. no one is watching out for us
12:59pm
except the consumer financial protection brewer roureau. it was obvious that american people needed a watchdog and got one in the form of the cfpb. it's created as part of dodd-frank. it was slow getting on its feet particularly because of resistance from the republicans in the u.s. senate. now it's up and runs. they put $405 million back into the pockets of consumers. they ordered american express to refund $85 million to more than 250,000 of its custome customer. they charged the company with violating consumer protection laws as, quote, every stage of the consumer experience from marketing to enrollment to payment to debt collection. in the last few months they targeted deceptive and i will lee practices at discover bank, capital one and all the major credit

Terms of Use (10 Mar 2001)